My 23 year old daughter worked for NIH for the last 5 months of 2018 after graduating from the University of Chicago in June. She is applying to graduate schools and will start graduate school in August 2019. She earned 12,000 at NIH in 2018 and it was reported as a Taxable Grant on a 1099-G. TurboTax is treating this as unearned income and taxing it at my tax rate. This seems wrong because she is WORKING 40 hours a week at NIH as a researcher. How can I get TT to treat this as earned income?
